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Grindstone Accelerator launches call to startups for first Gauteng cohort [Updated]
Venture capital (VC) company Knife Capital has joined forces with the SA SME Fund and Deloitte to launch the next iteration of its Grindstone Accelerator programme in Johannesburg.
Grindstone, which is jointly owned by Knife Capital and Thinkroom Consulting, assists high-growth innovation-driven small businesses to become sustainable and fundable through a year-long programme. Ten startups are selected per cohort.
The accelerator has run three cohorts so far. In November last year Knife Capital announced the names of those selected for a fourth cohort which is currently under way (see this story). So far all the cohorts have been run in Cape Town. This is the first time a programme will be run in Gauteng.
Applications for the year-long programme are now open and close on 22 April.
Knife Capital, which made the announcement in a press release yesterday, said programme promises to “spotlight the contribution that high-growth entrepreneurs make in enabling Gauteng to be the economic powerhouse of South Africa”.
It’s first time that the Grindstone Accelerator, which is on its fourth cohort now, will be run in Gauteng
Knife Capital co-managing partner Andrea Böhmert told Ventureburn by email that the final selection of participants will take place in May and the programme will start in June.
“The SA SME Fund will make some funding available to cover more immediate needs the companies might have — we are talking about amounts of up to R1-million.
“We have seen in the past that it is very difficult for companies to get such amounts at relatively short notice. Participation in Grindstone does not entitle to such funding but if the business case is solid, it will be favorably looked at,” said Böhmert.
She said that if participants require venture capital funding, Knife Capital will consider each case individually and if these fall within the VC’s mandate. Alternatively the VC will try to assist participants to find suitable investors within our network.
The commitment from the SA SME Fund is initially only for this year but Böhmert said that Knife Capital will consider whether to extend this, once the initial Gauteng cohort (Grindstone 5) has been completed.
She said Knife Capital will work with leading Johannesburg-based incubators and entrepreneurial support organisations, to deliver the programme.
Long-time strategic partners in Grindstone, FNB Business, Webber Wentzel and the BillyBo Group have once again committed their support to the entrepreneurs alongside some new collaborators.
SA SME Fund CEO Ketso Gordhan said his fund is committed to developing world class local entrepreneurs and has partnered with Grindstone as they have “consistently supported and grown South African scale-ups”.
The SA SME Fund will provide funding support to the 10 Grindstone companies to enable them to close the initial growth gaps identified.
The R1.4-billion fund, which is capitalised by 48 JSE-listed firms, was launched in 2016 by Discovery CEO Adrian Gore and former Bidvest chair Brian Joffe under the CEO Initiative, in which the government aimed to get the private sector to resuscitate the economy.
The SA SME Fund has already invested R20-million of the its capital in Knife Capital’s R100-million growth equity fund KNF Ventures.
Deloitte Africa chief digital and innovation officer Valter Adão said Deloitte will help introduce participating entrepreneurs and businesses to the networks that Deloitte has access to.
Across the previous programmes, the Grindstone Accelerator participants on average have experienced a consistent growth in revenue of 56% year-on-year, said Böhmert.
Knife Capital Co-founder Keet Van Zyl said the accelerator programme was created by compressing the VC firm’s venture capital engagement model of aggressively growing a company for three to five years into an intense year-long programme.
“But this is only possible because of the thought leadership our strategic partners provide” he adds.
Successful businesses that have completed the Grindstone Programme in the Western Cape include iKubu (subsequently acquired by Garmin), Payfast, SeaMonster Animation, Electrum Payments, Iono fm, Quicket, Picsa Finance, Custos and WhereIsMyTransport, among others.
Read more: Knife Capital announces participants in fourth cohort of Grindstone Accelerator
Read more: Hitting the high road – what it takes to join Grindstone accelerator [Q&A]
Read more: Knife Capital launches fourth edition of Grindstone Accelerator programme
Editor’s note (25 March 2019): The initial version of this article was updated to include emailed response provided by Knife Capital co-managing partner Andrea Bӧhmert.
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